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Local Foods Strengthen
   Your Local Economy




         Ken Meter
         Crossroads
         Resource Center
         (Minneapolis)

         Community Food Security
             Coalition F2S
         Portland, Oregon
         March 20, 2009
“Finding Food in Farm Country” Studies




plus Maui & Hawai’i



           44 regions in 19 states (8 statewide)
Local Farm & Food Economies




The perspectives of the
communities where
commodities are
produced and
used...

   …are often overlooked
Local foods may be our
 strongest path toward
  economic recovery
Vision for local food economies




Build:
  Health
  Wealth
  Connection
  Capacity
Schools play a role




   How can schools promote
         this vision?
Consumption out of balance




        50% of U.S. public school students
   • 
         qualify for free / reduced lunch
        10% of households are “food
   • 
         insecure”
Source: USDA                    Mural: The Food Project
Economic crisis brings
         opportunity!




     School budgets are strapped
• 

     People realize we need to change
• 




      Sources: Flegal, Wellman. Mural: The Food Project
Data
helps
  you
            Metro
make
           Denver
 your
          Health &
 case
          Wellness
        Commission
              &
        Civic Results
Economic roots of the crisis




  A primer on the economy
Economic crisis




  A “stimulus” will not be
          enough
Economic crisis




   We have to redirect the
         economy
Economic crisis




    Fundamental rule: the
 economy draws wealth away
    from our communities
The Bubble Economy




    Farms — 1973 – 1985
 Global Trade — 1990 - 2001
    Stocks — 1996 - 2001
   Housing — 2001 - 2007
  Derivatives — 2006 - 2008
-50
        0
            50
                      100
                                      150
                                                          200
                                                                250
                                                                      300
                                                                            350
                                                                                  400
                                                                                                                     450
 1929
 1931
 1933
 1935
 1937
 1939
 1941
 1943
 1945
 1947
 1949
 1951
 1953
 1955
 1957
 1959
 1961
 1963
 1965
 1967
 1969
 1971
 1973
 1975
 1977
 1979
 1981
 1983
                                                                                              1929 – 2009 (est) in billions ($2008)




 1985
 1987
 1989
 1991
                                                                                        U.S. Farm Cash Receipts and Production Expenses




 1993
                 Balance




 1995
                                   Prod Exp




 1997
 1999
                                              Cash Receipts




 2001
                 Farm Production




 2003
 2005
 2007
 2009
Household debt in U.S., 1974 - 2005

                          $1,200



                          $1,000



                           $800                                                                   Home mortgage debt
billions (2005 dollars)




                                                                                                  Consumer debt


                           $600



                           $400



                           $200



                           $-
                                   1974

                                          1976

                                                 1978

                                                        1980

                                                               1982

                                                                      1984

                                                                             1986

                                                                                    1988

                                                                                           1990

                                                                                                    1992

                                                                                                           1994

                                                                                                                  1996

                                                                                                                         1998

                                                                                                                                2000

                                                                                                                                       2002

                                                                                                                                              2004
                          $(200)
BEA
Net change in assets for consumers
                            in Western states, 1984 - 2006
$50,000



$40,000

                                                                     Change in Total Assets
$30,000                                                              Change in Total Liabilities
                                                                     Change in Net Assets


$20,000



$10,000



    $-
            1984
                   1985
                          1986
                                 1987
                                        1988
                                               1989
                                                      1990
                                                             1991
                                                                    1992
                                                                           1993
                                                                                  1994
                                                                                         1995
                                                                                                1996
                                                                                                       1997
                                                                                                              1998
                                                                                                                     1999
                                                                                                                            2000
                                                                                                                                   2001
                                                                                                                                          2002
                                                                                                                                                 2003
                                                                                                                                                        2004
                                                                                                                                                               2005
                                                                                                                                                                      2006
$(10,000)



$(20,000)



$(30,000)
              BEA
Issues in housing development




             30% of ALL loans made in
               U.S. metro areas were
                  subprime (2006)




Source: Wall Street Journal, October 11, 2007
Value Chain




                                        Food
                                       Service



Producer     Processor   Distributor   Retailer   Consumer
Farmers' share of retail prices paid by
                                  consumers, 1950-2004
                    900


                    800


                    700


                    600
$ billions (2004)




                    500


                                                         marketing bill
                    400

                                                         farm value
                    300


                    200

                          41%                                         20%
                    100


                     0



  Source ERS; chart by Ken Meter, 2007
Value Network



                          Policy
                         Council
Non Profits


                                       Consumer:
              Producer
                                     “Coproducer”

                         Processor
                                                          Retailer
  Educator


                         Distributor                 Food
                                                    Service
Corn sweeteners
                        consumed in U.S.,
                               1966-2002
                   Corn sweeteners consumed in U.S., 1966 - 2002

  70



  60



  50



  40

                                                                   HFCS
                                                                   Glucose
  30
                                                                   Dextrose


  20



  10



   0




Source: USDA/ERS — chart by Ken Meter, 2006
U.S. Youth Who are Overweight
                   Percent by Age
Percent
   16
                                                             14.0%
  14

                                                10.7%
  12
                                                              13%
  10
                                                  10.7%
    8

    6     4.6%
    4
          4.1%
    2

    0
          1963-70     1971-74      1976-80      1988-94        1999
                     Ages 6-11       Ages 12-17
  >95th percentile for BMI by age and sex, based on NHANES I reference data
  Source: Troiano RP, Flegal KM. Pediatrics 1998;101(3):497-504. NHANES
  1999, National Center for Health Statistics. Chart by Melinda Hemmelgarn
Energy is a major cost




•  The average food item in the U.S.
   travels 1,500 miles from farmer
   to consumer        Source: Aldo Leopold Center
Energy in the Food System




Source: BLS; Department of Energy (estimates based on 1976 studies)
The Bubble Economy




     Yet local action, and
   public policy, can create
          the change
Hood River, Oregon
Gorge Grown region

       Orchards export to:


       •  Mexico
       •  Columbia
       •  India
       •  Russia

Source: GGFN growers
Farm Production Balance
                                                       in Gorge Grown region, 1969-2006
                        0.30


                        0.25


                        0.20


                        0.15
 $ billions (current)




                        0.10                                                                                                       Cash Receipts
                                                                                                                                   Production expenses
                        0.05
                                                                                                                                   Balance

                        0.00
                                1969

                                       1971

                                              1973

                                                     1975

                                                            1977

                                                                   1979

                                                                          1981

                                                                                 1983

                                                                                        1985

                                                                                               1987

                                                                                                      1989

                                                                                                             1991

                                                                                                                    1993

                                                                                                                           1995

                                                                                                                                  1997

                                                                                                                                         1999

                                                                                                                                                2001

                                                                                                                                                       2003

                                                                                                                                                              2005
                        -0.05


                        -0.10


                        -0.15

Source: BEA
Farm Production Balance
                                                                in Gorge Grown region, 1969-2006
                             0.5

                                                                                                                                  Cash receipts
                                                                                                                                  Production expenses
                             0.4
                                                                                                                                  Balance

                             0.3
 $ billions (2006 dollars)




                             0.2

                                                                                  5 positive years
                                                                                  since 1983
                             0.1



                             0.0
                                    1969

                                           1971

                                                  1973

                                                         1975

                                                                 1977

                                                                        1979

                                                                               1981

                                                                                      1983

                                                                                             1985

                                                                                                    1987

                                                                                                           1989

                                                                                                                  1991

                                                                                                                         1993

                                                                                                                                1995

                                                                                                                                       1997

                                                                                                                                              1999

                                                                                                                                                     2001

                                                                                                                                                            2003

                                                                                                                                                                   2005
                             -0.1



                             -0.2
                                                                                             $600 million lost over last 30 years
Source: BEA
Gorge Grown region




                     Source: BEA
Gorge Grown region




                           56% of region’s
                            farms reported
                         net losses in 2002

Source: Ag Census
All told, Gorge Grown region...




•  Loses $20 million raising crops

•  Buys $90 million of outside inputs

•  Buys $200 million of outside food



   Potential wealth lost each year
Total loss to Hood River region is:


•  $310 million each year!
•  more than the value of all products
    produced in the region
•  more than the value of all food
    consumed in the region
What are people doing about this?
Direct Food Sales
Local Food Expenditures
                                              by the participating institutions in the
                          Black Hawk County Area, Iowa 1997-2007

                          $2,500,000

                                                                                                                  25

                          $2,000,000

                                                                                                                  20

                          $1,500,000
                                                                                                                  15


                          $1,000,000
                                                                                                                  10


                           $500,000
                                                                                                                  5




                                                                                                                  Number of Institutions
Local Food Expenditures




                                                                                                                  0
                                 $0
                                       1998   1999   2000   2001   2002   2003   2004   2005   2006   2007

                                                                     Year                        Local Food Expenditures
                                                                                                 Number of Institutions



                              Northern Iowa Food & Farm
                              Partnership
Rudy’s Tacos — Waterloo, Iowa




   71% local food!
Photo by Arion Thiboumery
Jobs, Fruit & Veggies, and
       Black Hawk County region

If Black Hawk region residents
   purchased locally grown fruits
   and vegetables just 3 months out
   of the year:
•  475 new jobs
•  $6.3 million in labor income
   added to local economy

David Swenson, ISU Economist
Organic Sales
Organic Valley
$ millions
                                                $ millions




                                -
                                    100
                                          200
                                                    300
                                                             400
                                                                   500
                                                                         600
                         1988

                         1989

                         1990

                         1991




Source: Organic Valley
                         1992

                         1993

                         1994

                         1995

                         1996

                         1997

                         1998

                         1999

                         2000
                                                                               Organic Valley Sales, 1988 - 2007




                         2001

                         2002

                         2003

                         2004

                         2005

                         2006

                         2007
Will Allen, Growing Power, Milwaukee
Growing Power, Milwaukee
Innovative farm operations



         Winter CSA
      Milan, Minnesota

  Fresh fresh organic greens
      November to April

  Sells only within 30 miles
Winter CSA — Milan, Minnesota
Winter CSA — Milan, Minnesota
Public sector can help




 Local and state governments
  spend $50 billion each year
     promoting economic
         development
Public sector can help




           Stimulus package has money
                 for schools, health
            infrastructure, job training,
                      and more!




Source: National Association of City and County Health Officials NACCHO)
Public sector can help




           Wisconsin asks that stimulus
            money be used to upgrade
                 school kitchens




Source: Michael Fields Institute
Data helps you make your case



     Appeal to officials on:

 •  reducing health care costs
 •  increasing tax base
 •  creating jobs
Schools represent a large market




   Schools spend $17 billion
      each year on food!
Source: Ag Census
Schools represent a large market

            Great Lakes Schools spend:

          Illinois                $350 million
          Indiana                  200
          Michigan                 235
          Minnesota                130
          Ohio                     230
          Wisconsin                135

               each year on food alone
for Great Lakes Farm to School Network
School spending cycles through
        economy


                   Multiplier studies:

     SW Wisconsin (farms)                        2.2 – 2.6
     NE Iowa (local food)                        1.91
     Oregon (schools)                            1.87
     Michigan (fruits & vegs)                    1.34
     Iowa (mainstream)                           1.3
Sources: Larry Swain, UWRF, David Swenson, ISU, Kaiser Permanente/
Ecotrust, Hamm et al, MSU, Swenson, ISU
Resources
     www.crcworks.org/econ.html
             (612) 869-8664
          kmeter@crcworks.org


www.crcworks.org/crcdocs/lfcedwd.pdf
    www.crcworks.org/cfscced.html
http://www.crcworks.org/crcdocs/MDHWC2008.pdf
“Finding Food in Farm Country”




     www.crcworks.org/econ.html
           (612) 869-8664


        kmeter@crcworks.org

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Local Foods Strengthen Your Local Economy

  • 1. Local Foods Strengthen Your Local Economy Ken Meter Crossroads Resource Center (Minneapolis) Community Food Security Coalition F2S Portland, Oregon March 20, 2009
  • 2. “Finding Food in Farm Country” Studies plus Maui & Hawai’i 44 regions in 19 states (8 statewide)
  • 3. Local Farm & Food Economies The perspectives of the communities where commodities are produced and used... …are often overlooked
  • 4. Local foods may be our strongest path toward economic recovery
  • 5. Vision for local food economies Build: Health Wealth Connection Capacity
  • 6. Schools play a role How can schools promote this vision?
  • 7. Consumption out of balance 50% of U.S. public school students •  qualify for free / reduced lunch 10% of households are “food •  insecure” Source: USDA Mural: The Food Project
  • 8. Economic crisis brings opportunity! School budgets are strapped •  People realize we need to change •  Sources: Flegal, Wellman. Mural: The Food Project
  • 9. Data helps you Metro make Denver your Health & case Wellness Commission & Civic Results
  • 10. Economic roots of the crisis A primer on the economy
  • 11. Economic crisis A “stimulus” will not be enough
  • 12. Economic crisis We have to redirect the economy
  • 13. Economic crisis Fundamental rule: the economy draws wealth away from our communities
  • 14. The Bubble Economy Farms — 1973 – 1985 Global Trade — 1990 - 2001 Stocks — 1996 - 2001 Housing — 2001 - 2007 Derivatives — 2006 - 2008
  • 15. -50 0 50 100 150 200 250 300 350 400 450 1929 1931 1933 1935 1937 1939 1941 1943 1945 1947 1949 1951 1953 1955 1957 1959 1961 1963 1965 1967 1969 1971 1973 1975 1977 1979 1981 1983 1929 – 2009 (est) in billions ($2008) 1985 1987 1989 1991 U.S. Farm Cash Receipts and Production Expenses 1993 Balance 1995 Prod Exp 1997 1999 Cash Receipts 2001 Farm Production 2003 2005 2007 2009
  • 16. Household debt in U.S., 1974 - 2005 $1,200 $1,000 $800 Home mortgage debt billions (2005 dollars) Consumer debt $600 $400 $200 $- 1974 1976 1978 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 $(200) BEA
  • 17. Net change in assets for consumers in Western states, 1984 - 2006 $50,000 $40,000 Change in Total Assets $30,000 Change in Total Liabilities Change in Net Assets $20,000 $10,000 $- 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 $(10,000) $(20,000) $(30,000) BEA
  • 18. Issues in housing development 30% of ALL loans made in U.S. metro areas were subprime (2006) Source: Wall Street Journal, October 11, 2007
  • 19.
  • 20. Value Chain Food Service Producer Processor Distributor Retailer Consumer
  • 21. Farmers' share of retail prices paid by consumers, 1950-2004 900 800 700 600 $ billions (2004) 500 marketing bill 400 farm value 300 200 41% 20% 100 0 Source ERS; chart by Ken Meter, 2007
  • 22. Value Network Policy Council Non Profits Consumer: Producer “Coproducer” Processor Retailer Educator Distributor Food Service
  • 23. Corn sweeteners consumed in U.S., 1966-2002 Corn sweeteners consumed in U.S., 1966 - 2002 70 60 50 40 HFCS Glucose 30 Dextrose 20 10 0 Source: USDA/ERS — chart by Ken Meter, 2006
  • 24. U.S. Youth Who are Overweight Percent by Age Percent 16 14.0% 14 10.7% 12 13% 10 10.7% 8 6 4.6% 4 4.1% 2 0 1963-70 1971-74 1976-80 1988-94 1999 Ages 6-11 Ages 12-17 >95th percentile for BMI by age and sex, based on NHANES I reference data Source: Troiano RP, Flegal KM. Pediatrics 1998;101(3):497-504. NHANES 1999, National Center for Health Statistics. Chart by Melinda Hemmelgarn
  • 25. Energy is a major cost •  The average food item in the U.S. travels 1,500 miles from farmer to consumer Source: Aldo Leopold Center
  • 26. Energy in the Food System Source: BLS; Department of Energy (estimates based on 1976 studies)
  • 27. The Bubble Economy Yet local action, and public policy, can create the change
  • 29. Gorge Grown region Orchards export to: •  Mexico •  Columbia •  India •  Russia Source: GGFN growers
  • 30. Farm Production Balance in Gorge Grown region, 1969-2006 0.30 0.25 0.20 0.15 $ billions (current) 0.10 Cash Receipts Production expenses 0.05 Balance 0.00 1969 1971 1973 1975 1977 1979 1981 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 -0.05 -0.10 -0.15 Source: BEA
  • 31. Farm Production Balance in Gorge Grown region, 1969-2006 0.5 Cash receipts Production expenses 0.4 Balance 0.3 $ billions (2006 dollars) 0.2 5 positive years since 1983 0.1 0.0 1969 1971 1973 1975 1977 1979 1981 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 -0.1 -0.2 $600 million lost over last 30 years Source: BEA
  • 32. Gorge Grown region Source: BEA
  • 33. Gorge Grown region 56% of region’s farms reported net losses in 2002 Source: Ag Census
  • 34. All told, Gorge Grown region... •  Loses $20 million raising crops •  Buys $90 million of outside inputs •  Buys $200 million of outside food Potential wealth lost each year
  • 35. Total loss to Hood River region is: •  $310 million each year! •  more than the value of all products produced in the region •  more than the value of all food consumed in the region
  • 36.
  • 37. What are people doing about this?
  • 39.
  • 40. Local Food Expenditures by the participating institutions in the Black Hawk County Area, Iowa 1997-2007 $2,500,000 25 $2,000,000 20 $1,500,000 15 $1,000,000 10 $500,000 5 Number of Institutions Local Food Expenditures 0 $0 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Year Local Food Expenditures Number of Institutions Northern Iowa Food & Farm Partnership
  • 41. Rudy’s Tacos — Waterloo, Iowa 71% local food! Photo by Arion Thiboumery
  • 42. Jobs, Fruit & Veggies, and Black Hawk County region If Black Hawk region residents purchased locally grown fruits and vegetables just 3 months out of the year: •  475 new jobs •  $6.3 million in labor income added to local economy David Swenson, ISU Economist
  • 45. $ millions $ millions - 100 200 300 400 500 600 1988 1989 1990 1991 Source: Organic Valley 1992 1993 1994 1995 1996 1997 1998 1999 2000 Organic Valley Sales, 1988 - 2007 2001 2002 2003 2004 2005 2006 2007
  • 46. Will Allen, Growing Power, Milwaukee
  • 47.
  • 49. Innovative farm operations Winter CSA Milan, Minnesota Fresh fresh organic greens November to April Sells only within 30 miles
  • 50. Winter CSA — Milan, Minnesota
  • 51. Winter CSA — Milan, Minnesota
  • 52. Public sector can help Local and state governments spend $50 billion each year promoting economic development
  • 53. Public sector can help Stimulus package has money for schools, health infrastructure, job training, and more! Source: National Association of City and County Health Officials NACCHO)
  • 54. Public sector can help Wisconsin asks that stimulus money be used to upgrade school kitchens Source: Michael Fields Institute
  • 55. Data helps you make your case Appeal to officials on: •  reducing health care costs •  increasing tax base •  creating jobs
  • 56. Schools represent a large market Schools spend $17 billion each year on food!
  • 58. Schools represent a large market Great Lakes Schools spend: Illinois $350 million Indiana 200 Michigan 235 Minnesota 130 Ohio 230 Wisconsin 135 each year on food alone for Great Lakes Farm to School Network
  • 59. School spending cycles through economy Multiplier studies: SW Wisconsin (farms) 2.2 – 2.6 NE Iowa (local food) 1.91 Oregon (schools) 1.87 Michigan (fruits & vegs) 1.34 Iowa (mainstream) 1.3 Sources: Larry Swain, UWRF, David Swenson, ISU, Kaiser Permanente/ Ecotrust, Hamm et al, MSU, Swenson, ISU
  • 60. Resources www.crcworks.org/econ.html (612) 869-8664 kmeter@crcworks.org www.crcworks.org/crcdocs/lfcedwd.pdf www.crcworks.org/cfscced.html http://www.crcworks.org/crcdocs/MDHWC2008.pdf
  • 61. “Finding Food in Farm Country” www.crcworks.org/econ.html (612) 869-8664 kmeter@crcworks.org